Recruiting SMEs for business-support programmes: What we're learning

One of the main strands of IGL’s work is to support our partners in experimenting with interventions that are aimed at increasing the productivity of small and medium-sized enterprises. The UK’s Business Basics Programme, the European Commission’s INNOSUP-06 programme, and many of the trials funded by our own grants programme are all driven by the recognition that adopting new practices or technologies could lead to large increases in productivity for SMEs.

We would expect that the SMEs with the most to gain from these programmes are those that are particularly lagging in terms of management practices, technology and productivity. But we’ve seen that these are also the businesses that are least likely to put themselves forward to participate: they tend not to be connected to existing support networks, and are likely to be overloaded with day-to-day concerns. In contrast, many of those who are quicker to seek assistance may already be getting support from other sources. So there’s a problem at the heart of many business-support programmes: having an impact depends on reaching SMEs that are particularly hard to reach.

So there’s a problem at the heart of many business-support programmes: having an impact depends on reaching SMEs that are particularly hard to reach.

For this reason, many of the trials supported by IGL over the past several years have made major efforts to get in touch with SMEs and encourage them to participate. In most cases recruitment has proven much more difficult than originally thought, even before the onset of the COVID-19 pandemic. While this has been disappointing (partly because it has limited the potential to analyse the impact of the programmes), it means that the programme teams have learned a lot about what does and does not work in reaching SMEs.

Some of the most obvious recruitment strategies have been found not to be so effective in practice. Promoting programmes in email newsletters (whether from the delivery organisations themselves, local authorities, or other local contacts) has generally produced few responses from SMEs. Social media has sometimes generated interest, but its effectiveness is highly dependent on the strength of the organisation’s existing network. Even advertising in specialist publications was found to have little effect: a full-page advertisement on the front cover of a leading nationwide industry publication resulted in only one approach from a suitable business.

In the end, most of the successful recruitment campaigns have been based on making direct, one-to-one contact with SMEs. While this can be highly effective, it can obviously also be time consuming and expensive. Getting in touch by email or phone also requires having contact details of the businesses, so many programme delivery teams have leveraged networks of SMEs that are maintained by local chambers of commerce, business schools, or other organisations. The downside is that those who are already on these mailing lists tend to be there by virtue of having received support in the past, so may not necessarily be the hard-to-reach SMEs that have the most potential to benefit.

One particularly interesting approach was taken by Devon County Council in England, who asked their Trading Standards Officers to visit SMEs to promote the ‘Engaging Rural Micros’ project. TSOs’ regular work involves visiting SMEs to advise on and check alignment with consumer law, so they have a good understanding of the challenges faced by businesses in their local area. As a result, they were able to build trust and present the benefits of the programme convincingly. This produced a large number of interested contacts at a modest cost, and meant that many businesses were recruited from beyond the council’s existing lists of contacts. (An evaluation report on the Engaging Rural Micros project will be available later this year.)

Once a business has expressed an interest, how do we encourage them to sign up and take part in the programme? Delivery partners often focus on making it as easy as possible to register and get started: we’ve seen that lengthy registration procedures or long time delays before the programme starts have both resulted in large drops in engagement. There’s a tension here when running a randomised trial, as we usually need to ask for the participants’ consent and collect some baseline data, but we’ve certainly seen companies being deterred when these procedures become too cumbersome. On the other hand, it’s possible that this acts as a filter to find out which companies are really interested: the businesses that are put off by a baseline survey may be those that were not fully committed to participating anyway.

These are crucial questions for making business support programmes succeed, but there’s a lot we still don’t know. Over the next several months, IGL will be carrying out a review of the learning generated from the Business Basics Programme – including through talking to the various delivery organisations in more detail about their recruitment strategies, what worked and what did not. We’ll be doing a similar exercise next year as the INNOSUP-06 programme draws to a close. Watch this space for more about what we’re finding out.